When the world reopens: what retailers need to do to prepare

As the Australian Federal Government moves to ease restrictions, it is time for retailers to prepare for re-opening in the ‘new normal’. Australians have been cooped up in their homes and are keen to get out and about – and retail will be a big part of this. While the old way of shopping may be over, here’s a checklist for retailers to strive and thrive in the new normal.

In the new normal, trust is the new currency. As you plan to re-open and seek to attract customers back in to store, understand that there are now new expectations in terms of safety and hygiene. The layout of your store and the manner in which your employees engage with customers will be essential to winning customers’ trust and reigniting your business.

Retailers should not re-open until they firmly believe they can address the health needs of each customer and staff member. Opening prematurely will erode customer trust and expose your business to lost sales and dissatisfaction amongst staff. This could also attract the attention of authorities and media, creating yet another hurdle in an already challenging time. It is imperative that you have all health and safety regulations ticked off before you open.

2. Look fabulous and be flexible

Retailers should be using this downtime to paint the walls and do other necessary maintenance work that is difficult to do while trading. Part of that essential maintenance is to ensure your store’s social distance strategies are clear and visible. For retailers, this might be signage with reminders to keep a safe distance between people when shopping, hand sanitiser stations and creating a traffic flow through the store to avoid people getting too close to each other.

You may also want to consider adjusting store hours and offering early morning or after hours’ appointments for private shopping.

3. Know your customer at a local level

In the new normal, retailers will need to go beyond traditional customer centricity or customer first strategies. To attract cautious customers, retailers will need to be hyper-relevant and hyper-local. As you prepare to re-open, analyse your customer database, target those who reside near your store(s) and engage them with timely and relevant information or offers.

As retail re-opens in other parts of the world, there is evidence to suggest a spike in localised trading. This spike has been attributed to a fear of travelling to highly populated areas. Understanding and targeting your local customers will deliver a big upside when you recommence trade.

4. Digital transformation is essential to survival

The COVID-19 pandemic has accelerated online spend growth within the 35+ year cohort. While growth is primarily underpinned by ‘essentials’, you can expect that this behavioural change will start to extend to all forms of purchasing in the new normal. Retailers should embrace a digital-first paradigm to maximise this opportunity. While the physical store will always act as a conduit, retailers should aim to maximise online sales upon re-opening.

5. Accurately assess finances

Hibernation appears to have created a false dawn for many businesses. The focus during this time has – rightly so – been on preserving cash by deferring rent and stretching creditors. As retailers seek to re-open, there will be a squeeze on cash as those liabilities get paid alongside the operating costs of re-opening. Robust and realistic cash flow and scenario modelling is essential right now to ensure businesses remain viable in the new normal. This includes doing a review of current infrastructure (stores, warehouses, staff) and creating a plan for what the business will look like in the new normal to remain viable.

What are the top four key financial areas of focus for Retailers this year end?

As retailers work through this challenging time, many will need to consider the impacts of COVID-19 on their financial statements. While there are numerous ways financial statements will be affected during this time, we’ve highlighted four that are bound to impact all retailers that have struggled with the lockdown measures.